Appendix A - Home Repair Loan Program Guidelines.pdf

HOUSING

REHABILITATION

LOAN PROGRAM

PROGRAM

GUIDELINES &

APPLICATION

Applications Must Be Emailed to:

{{CREATE EMAIL}}

Questions? Contact:

Becky Binz, Housing Planner 608-825-0869 bbinz@cityofsunprairie.com

City of Sun Prairie

Affordable Housing Rehab Loan Program Guidelines

Owner-Occupied

Background and Funding

The Sun Prairie Affordable Housing Fund (AHF) was established in 2020. Funding is from utilization of the State of Wisconsin’s One-Year Tax Increment Financing (TIF) Affordable Housing. The purpose of the AHF is to fund initiatives which:

1. Strategically invest in new affordable housing and rehabilitation of existing housing units, prioritizing efforts where the housing market is falling short.

2. Foster stability in all housing types, with an emphasis on affordable housing units.

In 2026 the City has $276,000 available from the City’s AHF to support the rehabilitation of owner-occupied housing.

Summary of Program

Funding to improve housing for income qualified residents throughout the City. This program can be used for a variety of improvement activities to improve the condition of aging housing stock. Requests for emergency repairs or repairs that address concerns over health and safety issues will be prioritized.

Housing that has previously received funds from the Sun Prairie rehabilitation loan program cannot apply for additional loans from the same fund for a period of three (3) years.

Application

Program funds will be available on a continuous basis, until funds are used up. Applications will be processed on a first-come, first-served basis. Requests for assistance for emergency repairs will be prioritized.

Eligible Applicants

Income cannot exceed 80% of the Dane County’s Area Median Income as defined by HUD.

(Homeowners’ income can be verified by using previous year IRS W-2 form or two months’ worth of pay stubs for all employed household members along with any additional income mentioned above in lieu of a W-2.)

Household

Size 80% or less of Dane County Area Median Income Range

1 Up to $72,700 2 Up to $83,100 3 Up to $93,500 4 Up to $103,850 5 Up to $112,200 6 Up to $120,500 7 Up to $128,800 8 Up to $137,100

Owner-Occupied

Project Eligibility

• Exterior Repairs. Repair or replacement of roofing, siding, windows, soffits, fascia, porches, decks, and balconies, gutters, and other repairs or replacement of exterior materials.

• Plumbing and Electrical. Upgrades to plumbing and electrical systems to bring them into compliance with current code standards.

• Energy Efficiency Improvements. Heating and air conditioning replacement, window repair or replacement, insulation improvements and other measures to increase overall energy efficiency.

• Accessibility Updates. Installation of ramps, non-slip surfaces, lever handles, and other improvements focused on making the house safe and accessible for everyone, regardless of age, physical ability, or stature.

• Other Code Compliance. Funds may be used to remedy outstanding building code and health/safety violations. Funds may also be used to abate lead-based paint and other environmental hazards such as asbestos and radon.

• Grading, Waterproofing, and Drainage Improvements. Funds may be used to remedy any issues related to stormwater runoff, including grading to take care of low spots in the lawn, rain gardens to address stormwater runoff, or basement waterproofing.

Applicants must obtain bids from credible and certified contractors, minimum two (2) bids required or show Good Faith Efforts were made to obtain two (2) bids. Construction must be completed within 180 days of start of construction, extension available upon request.

Loan Terms

• Up to $12,000 per unit per year.

• Loans will be at 0% interest. The loan amount is placed as a lien against your property and recorded with the Register of Deeds. It is repaid in full (no interest) at the time you sell, lease or vacate your home. If the home is transferred to a surviving spouse, the loan does not have to be repaid at that time.

Program Requirements

• The City may conduct annual inspections of properties, units must be made available for inspection when requested by City staff.

• Property must be located in the City of Sun Prairie

• Property must be following applicable zoning ordinances and land use guidelines.

• Property taxes, assessments and other liens on the property are current.

• Participants must be in good standing with all other mortgage holders.

• Loan to value ratio cannot be over 95% (i.e. if you owe over 95% of the value of your home, you would not qualify)

• The property cannot be put on the market to be sold, within the next twelve (12) months. If the property is sold within this time frame the applicant must pay a penalty fee equal to 10% of the

Owner-Occupied value of the loan, in addition to the loan being due immediately. If sale is due to a hardship such as death, permanent disability or serious illness, military deployment or reassignment, job relocation, severe financial distress, or natural disaster, applicant may request an exemption to the penalty fee by submitting a written request to the City of Sun Prairie.

• Applicants must be considered in good financial standing with all entities that hold a lien or mortgage on the property to be rehabilitated. Applicants with workout repayment plans with lien holders will not be considered. All small claims judgments against applicants must be satisfied prior to loan closing. Applicants will be requested to provide permission to verify employment, mortgages, deeds of trust, savings accounts, credit accounts, and all other information necessary to complete an application for a housing rehabilitation loan. Applicants showing any probability of foreclosure or bankruptcy within the next (12) months may be determined ineligible for the program.

• Eligible borrowers must own and occupy the home to be rehabilitated.

• Existing owner occupied single-family, condo, or duplex units qualify. If property is a duplex or condo unit, only the owner-occupied portion of the building is eligible. You must own and live in your home.

Failure to meet the program requirements will result in a default in the loan agreement and repayment of the balance of the loan at the time of default.

Contractors/Construction

It is up to you to select, hire, and contract for your home rehab or improvement project. Once approved for a loan, you can get quotes and start to hire contractors for your project. This program requires applicants to get quotes from two different contractors. Contractors will need to provide the City with a W-9 (Request for Taxpayer Identification) form so we can set them up as a vendor and pay them directly.

Local building permits must be taken out by you or the contractor for the work. If a permit is required, the City Building Inspector must sign off on the permit indicating that the work was completed.

Applicants should be aware they are responsible for resolving any disputes with the contractor.

Contractors must be licensed and bonded.

Applicant Information

Affordable Housing Rehab Loan Program Application – Owner Occupied

Please Return to: {{CREATE EMAIL}}

Applicant (s) Name :

Legal Names of all Persons on Property Deed:

Address: City: State: Zip Code:

E-Mail: Phone:

Number of persons in household: Annual Gross Household Income:

Income reporting year (use previous year) :

Applicants’ household income must be at or below 80% of the County Median Income Level. Please see below for current median Income Levels.

80% of Dane County Median Income (2025)

Household Size 1 2 3 4 5 6 7 8

Income Limit $72,700 $83,100 $93,500 $103,850 $112,200 $120,500 $128,800 $137,100

Property Information

Property Address Tax Key Number:

Year Built: Number of Units in structure: Is the property tax delinquent: Yes No

Are there any outstanding liens or Building and/or Zoning Code Violations on this property: Yes No

If you answered “Yes” Please explain:

What is your current monthly mortgage payment:

Remaining Balance: Years left until paid off:

Are there any other liens on your property such as additional mortgages, home equity lines of credit, contractor liens, etc.:

Yes No

If you answered “Yes” Please list:

PLEASE NOTE: All applications will be reviewed for completeness by City of Sun Prairie staff. Applications will not be processed until all required materials and information are submitted. Building permits may also be required. If you have any questions about completing this application, please contact the Planning Division at 608-825-0869 or via e-mail bbinz@cityofsunprairie.com.

Application materials must be submitted via email to: {{CREATE EMAL}}

Project Scope

Use this area to describe what projects you intend to use the Homeowner Rehabilitation Loan on. You should list projects and estimated costs. Feel free to use a separate piece of paper, spreadsheet or other method to list these items.

By signing here I acknowledge that I am applying for a loan, not a grant. This loan will need to be paid back according to the terms that will be set forth in a mortgage and promissory note. By signing below I also authorize City staff to visit my property and do a visual assessment of the work that was completed with the loan funds.

Applicant Signature: Date:

Owner Signature (if different from applicant): Date:

OFFICE USE ONLY: Date Submitted Income Verification Forms Received: Yes No mailto:bbinz@cityofsunprairie.com.

Affordable Housing Rehab Loan Program – Owner Occupied

Income Verification Form

The City of Sun Prairie Homeowner Rehab Loan Program has income-based qualification requirements. Before we can approve your loan application, you must complete and sign this income verification form. The following income information is needed because of the loan eligibility requirements. Applications that do not include a completed and signed Income Verification Form will not be processed.

In the area below please check the box next to your family size and then move across the row and circle the income range that corresponds with your 2025 Household Income. The number of people in the household is defined as the number of related individuals living in your residence. The income level is defined as the total reportable household income, which typically wages, salaries, pensions, child support, rental income and certain investment income. You can use your 2024 IRS 1040 form or your end of year W-2 from your employers to verify your household income level. Income levels are determined by Adjusted Gross Income (1040, Line 11). You must also submit a copy of your IRS 1040, employer issued W-2, or two months’ worth of paystubs for all employed household members with this application.

If you have any questions or need assistance with this form, please contact the Planning Division at 608-825-0869 or via e-mail bbinz@cityofsunprairie.com.

Household

Size 80% or less of Dane County Area Median Income Range

1 Up to $72,700 2 Up to $83,100 3 Up to $93,500 4 Up to $103,850 5 Up to $112,200 6 Up to $120,500 7 Up to $128,800 8 Up to $137,100

By signing below, I hereby attest that I have included all reportable household income and have selected the correct house-hold size and income range. I understand that misrepresentation of my income level and/or household size may result in my loan application being rejected.

Applicant Name:

Applicant Signature: Date:

Applicant Address:

mailto:bbinz@cityofsunprairie.com.